MARTINEZ, Calif. – A Modesto paving firm may get a $2.466,223.41 contract tonight if Martinez City Council accepts its bid for the 2018-19 Measure D street sealing project.

City Engineer Tim Tucker has recommended the Council accept the bid from American Pavement Systems, whose bid was higher than the $2.4 million engineering estimate for the work, but was the lowest of the bids, which went as high as nearly $2.7 million.

“This project will cape seal streets in residential areas throughout town,” Tucker wrote in his report to the Council. “The bids include an alternate work area which will micro-seal Ward Street, Escobar Street and other downtown areas.”

He wrote that city employees are advertising for bids for the 2018-19 paving projects that will finish base failure repair for streets in preparation for the Measure D Pavement Rehabilitation (cape seal) Project.

Money for the projects will be completing using gas tax including the revenue from the gas tax increase, Senate Bill 1, as well as from Contra Costa County’s Measure J half-cent transportation and paving sales tax and the city’s own Measure D half-cent sales tax approved in 2016 specifically to address the condition of Martinez’s local roadways, which in 2015 were ranked worst in the county except for those in Orinda.

Prior to the passage of Measure D and SB1, Martinez only had about $450,000 available annually for street paving and preservation. That amount was inadequate, tucker wrote. With the two new revenue sources, the city has a total of about $4.4 million a year to work on its streets and roads. “This represents nearly a 10-fold increase in available funding,” Tucker wrote.

But Martinez had to wait for the half-cent revenues to accumulate, Tucker explained. That started happening until spring of 2017, and California didn’t distribute the money until September 2017, he wrote. The Council normally doesn’t spend its revenues before they’re received, Tucker said. , and Measure D money wasn’t allocated and available for spending until July 1 of this year.

However, to meet the Council’s goal of using Measure D money “in an expeditious manner,” city employees used Fiscal Year 2017-18 gas tax funds to complete designs of the 2019-19 Measure D Pavement Rehabilitation Project.

“This allows for construction this fall instead of next spring as would normally occur,” Tucker explained.

In addition to the contract, the project budget has cushions for contingencies, as well as money for management, inspections and other support, bringing the total to $2.725,000.

Part of the funding has been included in the 2018-19 Capital Improvement Program allocation of Measure D funds, and Tucker is recommending another $1,025,000 of Measure D revenues also be allocated.

“The city has collected approximately $4 million through the end of May 2018,” Tucker wrote. “An additional $300,000 in Measure D revenues are expected for June, ending the fiscal year. There is adequate Measure D unallocated reserves for this proposed allocation of funds.”

In other matters on tonight’s agenda, the Council will be asked to approve an extension to its Laborers’ International Union of North America Local 324.

The city and the union have been in labor negotiations for the past few months, Assistant City Manager Anne Cardwell wrote in her report. The two reached an agreement July 26 to extend its current Memorandum of Understanding to Jan. 31, 2019, she wrote.

Some of those talks centered on the dissolving of the Pleasant Hill/Martinez Joint Facilities Agency (JFA,) another item on tonight’s agenda. That dissolution will result in moving former JFA employees to the city’s employee rolls, after which they must start paying 6.2 percent of their salary into Social Security, she wrote.

“To ease this transition for employees, the city has agreed to cove the employees’ 6.2 percent contribution to Social Security in the form of a taxable reimbursement on employees’ paychecks beginning Aug. 1,” she wrote.

Among other changes, the city agreed to work with the union to move its Martinez members to California Public Employees Retirement Service (CalPERS) health, she wrote. Estimated cost for the extension is $136,000, which needs to be allocated from the city’s 2018-19 reserves.

The Council also will consider approving another step in the ending of the JFA. Finance Director David Glasser will ask the panel to approve a resolution authorizing a lease agreement that would finance the resulting tax liability from reclassifying the JFA employees as city employees.

“The city is required to pay the Social Security taxes for up to three years retroactively for the employees currently in the JFA,” Glasser wrote in his report. “The city is also paying the employee share for the three-year period. The retroactive payments need to be in process by Aug. 1, 2018, to comply with a settlement agreement between the city and CalPERS.”

Martinez City Council will act as the Board of Directors of the City of Martinez Public Improvement Corporation, which will be the body that must adopt a resolution authorizing the execution and delivery of the lease agreement that would pay for the tax liability associated with dissolving the JFA, Glasser wrote. The Council will convene as that Board during a portion of tonight’s meeting to take action on the lease, Glasser wrote.

As in the case of Local 324, the city will be picking up the Social Security tab for other employees as well.

A five-year loan of up to $4 million from US Bank has been arranged to mitigate the impact on the city’s cash flow and reserves, he explained. However, the city’s bond counsel Jones Hall has recommended modifying the loan structure to conform to California constitutional debt restrictions.

Specifically, it would be a hybrid lease purchase and cash secured arrangement, which Glasser wrote would let the transaction be completed within the settlement’s tight timeframe while retaining a lower interest rate.

However, this would require Martinez to lease City Hall to the nonprofit Martinez Public Improvement Corporation in return for the $4 million site lease payment. The building would be leased back to the city in return for semi-annual lease payments.

The Council also will decide whether to approve a schematic design for improvements for Golden Hills Park.

At a community workshop at the park, city employees shared ideas proposed for the park’s modernization and took public comment for incorporation and adjustment of those plans.

The Park Subcommittee completed the schematic plan June 19, incorporating the public’s recommendations, and the Parks, Recreation, Marina and Cultural Commission approved sending the plans to the Council for approval, with the addition of up to two more picnic tables.

The improvements, estimated at more than $1.8 million, would be underwritten by Measure H money. Bids will be sought and a contact may be awarded in December, with construction starting in 2019.

The Council also will be asked to approve a $125,235 landscape maintenance agreement with P.J. McNamara for its eight lighting and landscape districts.

The Martinez City Council meeting will start at 7 p.m. today in Martinez City Hall, 525 Henrietta St.

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